Post-lecture Multiple Choice Questions Answer Key Part 7

MODULE RESULTS expand all collapse all QUESTIONS: 43 attenpets Which of the following statements regarding activity-based costing systems is false? CORRECT ANSWER ABC systems may only be used by service companies Alpha Company manufactures breadboxes and uses an activity-based costing system. The following information is provided for the month of May: Activity Estimated Indirect Activity Costs Allocation Base Estimated Quantity of Allocation Base Materials handling 53,500 Number of parts 5,000 parts Assembling $12,000 Number of parts 5,000 perts Packaging $5,750 Number of breadboxes 1.250 breadboxes Each breadbox consists of four parts and the direct materials cost per breadbox is $7.00. What is the total manufacturing cost per breadbox? identify activity cost pools see min What is the predetermined overhead allocation rate based on direct labour costs as a single plant wide rate? CORRECT ANSWER: 33% see more Use activity-based costing to compute the unit product cost of product D28K CORRECT ANSWER $95.34 per unit see more Which of the following would be the best cost driver for the assembling cost pool? CORRECT ANSWER: Number of parts What is the first step in developing an ABC system? CORRECT ANSWER Identify the primary activities. see more have separate cost allocation rates for each activity identified by the company. CORRECT ANSWER: Activity-based costing (ABC) systems see more Stevenson Corp. has total estimated overhead of $345,000 and total actual overhead of $355,000. Total estimated direct labour hours were 23,500 hours and total estimated machine hours were 45,000 hours. Total actual direct labour hours were 24.000 and total actual machine hours were 55,000, Stevenson is highly automated. What is the amusant of overhead allocated to Job 23 that had estimated direct labour hours of 22, actual direct labour hours of 25, estimated machine hours of 45, and actual machine hours of 527 CORRECT ANSWER: $398.84 A relevant facility-level cost driver for heating costs is CORRECT ANSWER A labour-intensive service company budgeted for 20X3 a total of 40,000 direct-labour hours and $220,000 of overhead costs. However, the actual 20X3 amounts were 44,000 hours and $240,000 cost, respectively. The applied overhead should be CORRECT ANSWER $242,000 Activity analysis of indirect costs identified the following costs and rates Materials handling: $0.50 per kilogram Engineering $500 per engineering change Utilities: 50.40 per kilowatt-hour Distribution: $18 per unit shipped Order #77, shipped to the customer, consisted of 15 units of finished product, and consumed 200 kilograms of material and 300 kilowatt-hours of power. There were five engineering changes to the order before it was completed. The Indirect cost of Order #77 was CORRECT ANSWER: $2,990 What is the predetermined overhead allocation rate for spinning? CORRECT ANSWER: $0.40 per machine hour Each cost in the activity cost pools are COSU CORRECT ANSWER: manufacturing overhead (MOH) What is the estimated departmental overhead cost pool for each department? CORRECT ANSWER: $62.50 for the Preparation Department and $33.33 for the Processing Department An example of a value-added activity in manufacturing is CORRECT ANSWER: reduction of delivery speed What is the predetermined overhead allocation rate using the traditional costing system? CORRECT ANSWER: S19 An example of a non-value added activity would include CORRECT ANSWER: travelling to a supplier for a mecting